On January 24, 2018, at the Fintech session organized by the Istanbul Bar Association’s IT Commission, our Managing Partner Erdem Mümtaz Hacıpaşaoğlu delivered a talk titled “The Legal Status of Crowdfunding and ICOs”.
The central thesis of the talk was clear: despite structural similarities, crowdfunding and ICOs occupy different legal positions in Turkey; how each maps onto the securities/investment-contract spectrum shapes the foundational questions of regulation.
The legal position of crowdfunding
The framework, threshold amounts, platform obligations and investor protections of equity-based crowdfunding under the Capital Markets Law were addressed; the talk then turned to whether donation- and reward-based crowdfunding falls within securities law.
The legal status of ICOs
Where the token is utility, security, or hybrid in nature, the applicable regime was discussed: drawing on international parallels like the Howey test and comparing them to the Turkish definitions of securities and investment contracts; the risk of falling under SPK supervision and investor-protection obligations were emphasized.
Highlights from this talk
- Crowdfunding: Equity-based, donation, reward: the distinctions
- ICO: Utility / security / hybrid token debate
- Regulation: Capital Markets Law framework, thresholds
- Comparison: Howey test and the Turkish position
You can watch the talk on YouTube.
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